What is Cloud Accounting and why you Need it as Part of Your Disaster Preparedness Plan

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What is Cloud Accounting and why you Need it as Part of Your Disaster Preparedness Plan


Debri blocking road during a typhoon

The effects of a disaster are especially noticed by small business owners, who may struggle keeping their doors open after a fire or flood. In fact, the U.S. Department of Labor estimates that 40 percent of all businesses affected by a disaster never reopen their doors. A good number of the remaining 60 percent rely on some form of cloud accounting to help them recover. What is cloud accounting and why do you need it as part of your disaster preparedness plan? That’s a very good question, and something we are always happy to talk about.

What is Cloud Accounting?

Put simply, cloud accounting refers to bookkeeping and related services that are performed via the Internet. Rather than installing certain software on your computer, you use the World Wide Web to access it. You pay only a small monthly fee to access this software. In most cases, this is far more cost-effective than purchasing the software outright.

Cloud accounting allows you to automate multiple functions such as bookkeeping, payroll, and taxes. Some cloud-based accounting services also afford you the opportunity to store documents such as tax returns or year-end reports so that you no longer have to rely on paper records.


There are several benefits to cloud accounting, many of which will come in especially handy during a disaster. For example, there is no need to store or maintain special hardware, so you will not need to worry about repairing or replacing damaged equipment before accessing your data.

The fact that there is only one ledger kept in the cloud ensures accuracy at a time when things may be a little bit frantic. Ultimately, this will reduce errors and make getting certain aspects of your business back up and running again much easier.

When you use cloud accounting, your operations also will not have to come screeching to a halt. You can access information from anywhere, meaning you can keep on working even if you have had to evacuate.

Implementing a Plan

A disaster preparedness plan for your business consists of two parts: disaster recovery and business continuity. Disaster recovery deals with how employees will act during an emergency, including how they are to communicate with one another. The business continuity aspect of a plan involves how your company will remain up and running during a disaster. This is the area that cloud-based accounting falls into. Some things related to cloud accounting that might be included in the business continuity section include:

  • Where operations will move to if you are forced to temporarily relocate. In the case of cloud accounting, you will determine where you might go to access the cloud if Internet service is down in your area.
  • Areas of responsibility-in other words, who will be responsible for what accounting functions.
  • A listing of key personnel-who exactly will you rely on to recover certain data, and how will you communicate with these individuals?
  • Backup power arrangements so that you can go on working on site if the situation allows
  • A step-by-step process for reinstating operations based upon a hierarchy of needs. For example, you will likely be more concerned with invoicing clients than you are with tax issues.

Once you have put a plan in place, you’ll need to reevaluate it on a regular basis to ensure it is always up to date. Consider reviewing your plan monthly or any time you make a significant change to the way you operate.

Switching to the cloud can help your business remain competitive after a disaster, and could ultimately affect whether or not your doors stay open. If you would like to know more about cloud-based accounting and the benefits it offers for your small business, please feel free to contact us.


By | 2016-11-17T13:49:32-07:00 November 17th, 2016|Accounting, Blog|Comments Off on What is Cloud Accounting and why you Need it as Part of Your Disaster Preparedness Plan

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